Valuation 3:D - 1(25) Entertainment and Media: Markets and Economics Franchise Valuation
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- Slide 1
- Valuation 3:D - 1(25) Entertainment and Media: Markets and
Economics Franchise Valuation
- Slide 2
- Valuation 3:D - 2(25) Valuation
- Slide 3
- 3:D - 3(25) Valuation in Theory Twitter, February 2014
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- Valuation 3:D - 4(25) www.msnbc.com/id/21458486/ Employing a
well known theorem: $240M/0.016 = $15.0B
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- Valuation 3:D - 5(25) Facebook $104B IPO At $38/sh $224B A
fortuitous bet by Microsoft. 2015 valuation is as much as $224B.
Apx 1,500% return in 7 years.
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- Valuation 3:D - 6(25) The Discounted Stream of Profits Model Is
So 20 th Century Aswath Damodaran (Stern School of Business, NYU,
March 7, 2014) A couple of weeks ago, Facebook announced that it
was acquiring WhatsApp for $19 billion. That sounded like an
astoundingly high price to pay for a company with 55 employees and
very little revenue in the most recent time period. While
WhatsApp's messaging service has almost 450 million users, growing
significantly by the day, the business model for WhatsApp, which
emphasises that it accepts no advertising and charges users $1/year
(after an initial year of free service) seems incapable of
delivering the earnings that you would need to sustain the price
paid by Facebook. Or is it? Facebook is valuing the increased user
base. Facebook knows almost a billion phone numbers. How do we
translate that into increases in the value of Facebook (not of
WhatsApp)?
- Slide 7
- Valuation 3:D - 7(25) $135 Million
http://www.nytimes.com/2006/06/19/arts/design/19klim.html?ex=1308369600&en=37eb32381038a749&ei
=5088&partner=rssnyt&emc=rss Klimt, to Ronald Lauder
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- Valuation 3:D - 8(25) Uncertainty in Valuation: Valuation is a
forecast
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- Valuation 3:D - 9(25) Sometimes the forecast is incorrect.
Yahoo Valuation Yahoo! 2004 Gross Revenue: 3.60 billion Yahoo! 2004
Net Income: 0.84 billion Microsoft Price: $45B Yahoo! Revenue about
$7B in 2008 If Yahoo! were essentially the same company in 2008,
wed expect ($7B/$3.6B)$0.84B = 1.63B profit per year. $45B offer =
27.6 times earnings! But, in first quarter 2008:
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- Valuation 3:D - 10(25) Markets Move Quickly to 2012 Yahoo was
once the leading internet company but has been forced to watch as
relative upstarts like Google (NASDAQ: GOOG) and Facebook race past
it. Things have gone downhill for Yahoo ever since it unwisely
rejected a $45 billion buyout offer from Microsoft (NASDAQ: MSFT)
four years ago. Its current market valuation is now just barely
over a third of the generous Microsoft offer. Unwise in retrospect.
Was it unwise at the time?
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- Valuation 3:D - 11(25)
http://www.techcrunch.com/2006/10/09/google-has-acquired-youtube/
Valuation Matters
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- Valuation 3:D - 12(25)
http://mashable.com/2007/03/13/viacom-youtube/ Valuing The Right
Viacom had the value of the Google purchase as a foundation for its
claim.
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- Valuation 3:D - 13(25) That Viacom Lawsuit Real lawsuit for
damages? Gambit for establishing bargaining position? Warner Music
YouTube, 2005, revenue sharing arrangement. A share of the ad
revenues Warner channels set up on YouTube.
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- Valuation 3:D - 14(25) 6/23/10 -- Safe Harbor Defense
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- Valuation 3:D - 15(25) A Bid that Seemed Too High *
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- Valuation 3:D - 16(25) This is Vertical Integration
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- Valuation 3:D - 17(25) Realized Market Valuation
http://www.nytimes.com/2010/08/06/sports/baseball/06rangers.html
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- Valuation 3:D - 18(25) NHL 2005,2009,2014 Value Seems
Disconnected From Income Team/Principal Owner Value ($M) Income
($M) New York Rangers/Cablevision Systems $263 -6.92 Dallas
Stars/Thomas Hicks 254 5.63 Toronto Maple Leafs/Larry Tanenbaum 241
13.84 Philadelphia Flyers/Comcast-Spectacor 262 3.55 Detroit Red
Wings/Michael Ilitch 266 -3.70 2014 1,300 1,100 1,000 570 625 420
750 800 360 330 370 580 400 825 451 365 360 565 425 475
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- Valuation 3:D - 19(25) Baseball 2009, 2014 Note the large
variance of the valuations.
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- Valuation 3:D - 20(25) National Football League (2009,2014)
2014 3,200 2,400 2,600 2,100 1,800 1,850 1,750 1,225 1,700 1,450
1,500 1,250 1,120 1,100 1,400 1,350 1,375 1,300 1,160 1,330
Spectacular brand new city owned stadium
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- Valuation 3:D - 21(25) MLB vs. NFL (2009) The interesting
comparison is the variance, not the mean.
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- Valuation 3:D - 22(25) Basketball 2009,2014 2014 2,500 2,600
2,000 810 915 1,250 1,150 910 1,700 1,000 920 1,175 700 850 900 800
875 1,300 855 940 Franchise values have exploded. New $24 billion
television contract
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- Valuation 3:D - 23(25)
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- Valuation 3:D - 24(25) Not Just an American Thing Manchester
United: English Premier League Soccer: Revenue - $225million: Value
- $1000m (2002) And Manchester United can count a world-wide fan
base of over 50 million zealots recruited to the cause. The
Manchester United Food & Beverage Group (MUFB) has opened a
restaurant in the Chinese city of Chungdu. Eventual plans could see
up to as many as 100 restaurants opened in the Asia market over the
next ten years. MU branded football (soccer) restaurants selling
shirts, posters,videos and novelty gifts - as well as food - are
planned for Singapore, Malaysia, Hong Kong, Thailand, Taiwan, South
Korea, the Philippines, Indonesia, Japan, India and Brunei with the
stated aim of cashing in on the lucrative interest many Asian
nations (estimated at 17 million fans) hold for the English
game.
- Slide 25
- Valuation 3:D - 25(25) World Football: 2010,2014 2014 2,810
3,440 1,331 1,850 691 856 3,200 868 850 580 514 307 483 326 599
863